Securities Lawyer's Deskbook
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General Rules and Regulations
under the
Securities Exchange Act of 1934

Rule 3b-15 -- Definition of Ancillary Portfolio Management Securities Activities

  1. The term ancillary portfolio management securities activities means securities activities that:

    1. Are limited to transactions in connection with:

      1. Dealer activities in eligible OTC derivative instruments;

      2. The issuance of securities by the dealer; or

      3. Such other securities activities that the Commission designates by order pursuant to Rule 15a-1(b)(1); and

    2. Are conducted for the purpose of reducing the market or credit risk of the dealer or consist of incidental trading activities for portfolio management purposes; and

    3. Are limited to risk exposures within the market, credit, leverage, and liquidity risk parameters set forth in:

      1. The trading authorizations granted to the associated person (or to the supervisor of such associated person) who executes a particular transaction for, or on behalf of, the dealer; and

      2. The written guidelines approved by the governing body of the dealer and included in the internal risk management control system for the dealer pursuant to Rule 15c3-4; and

    4. Are conducted solely by one or more associated persons of the dealer who perform substantial duties for, or on behalf of, the dealer in connection with its dealer activities in eligible OTC derivative instruments.

  2. The Commission may issue an order pursuant to Rule 15a-1(b)(4) clarifying whether certain securities activities are within the scope of ancillary portfolio management securities activities.

Regulatory History

63 FR 59362, 59395, Nov. 3, 1998

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